Illinois Tool Works Inc (ITW)
Cash ratio
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 1,065,000 | 990,000 | 922,000 | 1,143,000 | 708,000 | 774,000 | 879,000 | 1,296,000 | 1,527,000 | 1,987,000 | 2,058,000 | 2,484,000 | 2,564,000 | 2,169,000 | 1,812,000 | 1,430,000 | 1,981,000 | 1,825,000 | 1,677,000 | 1,755,000 |
| Short-term investments | US$ in thousands | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Total current liabilities | US$ in thousands | 4,675,000 | 3,982,000 | 4,040,000 | 5,596,000 | 4,460,000 | 4,392,000 | 4,294,000 | 3,858,000 | 3,470,000 | 2,996,000 | 2,960,000 | 2,680,000 | 2,589,000 | 2,540,000 | 2,042,000 | 2,032,000 | 2,154,000 | 2,223,000 | 2,188,000 | 3,961,000 |
| Cash ratio | 0.23 | 0.25 | 0.23 | 0.20 | 0.16 | 0.18 | 0.20 | 0.34 | 0.44 | 0.66 | 0.70 | 0.93 | 0.99 | 0.85 | 0.89 | 0.70 | 0.92 | 0.82 | 0.77 | 0.44 |
December 31, 2023 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($1,065,000K
+ $—K)
÷ $4,675,000K
= 0.23
The cash ratio shows Illinois Tool Works, Inc.'s ability to cover its short-term liabilities with its available cash and cash equivalents. A higher cash ratio indicates a stronger ability to pay off current obligations using liquid assets.
Looking at the trend over the past eight quarters, Illinois Tool Works' cash ratio has varied between 0.21 and 0.43. The ratio has been fluctuating, showing some volatility in the company's ability to cover its short-term liabilities with cash on hand.
In the latest quarter, Q4 2023, the cash ratio was 0.27, which suggests that the company may have had some challenges in meeting its short-term obligations with available cash. However, it is essential to consider industry norms and compare the company's ratio with its peers to gain a better perspective on its liquidity position.
Overall, Illinois Tool Works, Inc. should aim to maintain a healthy cash ratio to ensure it can meet its short-term financial commitments without relying heavily on external financing. It may also be beneficial for the company to analyze its cash management practices and strategies to optimize its liquidity position.
Peer comparison
Dec 31, 2023